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Annual Report of Revenue, Expenses, and Volumes
Community Benefit Program
Trustee Disclosure Information
Global Budget Revenue (“GBR”) methodology is central to achieving the three part aim set forth in the All-Payer Model of promoting better care, better health, and lower cost for all Maryland patients. In contrast to the previous Medicare waiver that focused on controlling increases in Medicare inpatient payments per case, the new All-Payer Model focuses on controlling increases in total hospital revenue per capita. GBR methodology is an extension of TPR methodology, which encourages hospitals to focus on population-based health management by prospectively establishing a fixed annual revenue cap for each GBR hospital.
The Total Patient Revenue System (“TPR”) is a revenue constraint system available to sole community provider hospitals and hospitals operating in regions of the State characterized by an absence of densely overlapping service areas. The TPR system provides hospitals with a financial incentive to manage their resources efficiently and effectively in order to slow the rate of increase in the cost of health care. The TPR also is consistent with the Hospital’s mission to provide the highest value of care possible to the community it serves.
Under GBR and TPR contracts, each hospital’s total annual revenue is known at the beginning of each fiscal year. Annual revenue is determined from an historical base period that is adjusted to account for inflation updates, infrastructure requirements, population driven volume increases, performance in quality-based or efficiency-based programs, changes in payer mix and changes in levels of UCC. Annual revenue may also be modified for changes in services levels, market share shifts, or shifts of services to unregulated settings.
The Market Shift Adjustments (MSAs) mechanism is part of a much broader set of tools that links global budgets to populations and patients under the State's new All-Payer Model. The specific purpose of the MSA is to provide criteria for increasing or decreasing the approved regulated revenue of Maryland hospitals operating under GBR or TPR rate arrangements. Providing these criteria is important for ensuring that revenue is appropriately reallocated when shifts in patient volumes occur between hospitals as a result of efforts to achieve the Triple Aim of better care, better health, and lower costs. MSAs under GBR arrangements are fundamentally different from volume adjustments. Hospitals under a population-based payment system, such as GBR, have a fixed budget for providing services to the population in their service area. Therefore, it is imperative that MSAs reflect shifts in patient volume independent of general volume increases in the market.
Under the new All-Payer Model, inter-hospital transfers are an area of concern that must be addressed to ensure that revenue appropriately follows the patient when changes to transfer rates occur and that resources are readily available to care for complex cases. As academic medical centers (AMCs) providing quaternary services, Johns Hopkins Hospital and University of Maryland Medical Center play a distinct role in the health care system by handling a large proportion of highly acute cases, accepting regional referrals, and serving as centers for clinical and technological innovation in the State. For global models to be successful in Maryland, different regulatory treatment must be given to specific areas of service at these AMCs that will allow them to function effectively within this new payment structure.
The HSCRC developed a demographic adjustment to allow for hospital service volume changes due to population change as well as population aging, without allowing for increases in hospital service volume due to potentially avoidable utilization (PAU). The approach is based on a hospital’s virtual patient service area (VPSA) and also uses a per capita efficiency factor to bring the overall demographic adjustment within the level provided under the new All-Payer Model for population growth as determined by update factor recommendation.
The UCC Write-off Public Use dataset contains unique patient-level information obtained from the Uncompensated Care Write-off data, as well as, from the inpatient and outpatient confidential datasets submitted to the Commission for fiscal year 2015. The data is intended to be used strictly for modeling and evaluation of alternative methods of estimating Maryland hospitals uncompensated care amounts to be built prospectively into rates for fiscal year 2017.
Each requester of the data must sign the DUA and complete the Certificate of Destruction. Submission of analysis results and the completed Certificate of Destruction to HSCRC is required of each requester by March 30, 2016.
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